Greece is testing a new electricity-market structure intended to create an additional revenue stream for factories, EV fleets, commercial buildings and distributed energy assets. The approach also aims to give grid operators an alternative to some conventional network reinforcement. The work involves transmission operator IPTO, distribution operator HEDNO, power company PPC, market operator HENEX and flexibility-platform provider NODES.
Projects involving IPTO, HEDNO, PPC, HENEX and NODES are examining how distributed resources can sell flexibility to both transmission and distribution networks. The goal is to avoid conflicting dispatch instructions while coordinating national and local network requirements. The commercial significance described for the model is linked to how customers can be paid for changing electricity consumption or production when it has grid value.
Flexibility procurement for transmission and distribution networks
A Greek demonstration under the European OPENTUNITY programme is testing a market in which IPTO and HEDNO act as flexibility buyers. Aggregators combine distributed resources and offer them into a system designed to coordinate national and local network requirements. The resources listed include commercial and residential demand, water heaters, air-conditioning systems, distributed generation and other controllable electricity assets.
The model identifies the DSO as a key commercial change, with the distribution operator emerging as a potential customer. A distribution operator typically addresses network constraints through infrastructure investment and operational measures. Under the flexibility-market approach, the DSO can pay customers to temporarily change electricity behaviour when and where the network is constrained.
The text describes scenarios where a transformer is overloaded only during a limited number of hours each year. In such cases, purchasing demand reduction during those hours could potentially be cheaper than replacing the transformer immediately. It also states that flexibility would not eliminate conventional grid investment where constraints are structural.
It is stated that flexibility could defer some expenditure, improve utilisation of existing assets and allow network companies to target capital more efficiently. For market participants, the model implies that network congestion itself can become a source of revenue. This is tied to how value depends on location within the network.
Locational value, verified flexibility products and revenue stacking
The material distinguishes local flexibility value across locations, noting that reducing one megawatt of demand in an unconstrained area may provide little value to HEDNO. Reducing the same megawatt behind an overloaded transformer could be substantially more useful. This creates a market for locational flexibility.
The product described is not merely electricity but a verified change in electricity consumption or production at a specified place and time. If Greece commercialises the model, electricity customers could receive payments partly based on where they are connected to the grid. The text also links this structure to a shift from conventional wholesale electricity trading.
The model is described as expanding aggregator business cases by adding local DSO flexibility alongside balancing markets. An aggregator already participating in balancing markets could add local DSO flexibility as another revenue source. Portfolios containing factories, EV chargers, commercial buildings, heat pumps or distributed generation could be optimised across several potential markets.
The aggregator role described involves deciding where each megawatt of flexibility has the highest value between national balancing needs for IPTO and local constraint relief needs for HEDNO. It also states that local network payments could provide an additional revenue stream without requiring the asset owner to become an electricity trader. The text further notes that distributed assets may have economics difficult to justify from electricity-price optimisation alone.
Participation by EV fleets, buildings and industrial flexible loads
The material describes EV fleets as primary transport businesses rather than electricity businesses. If dozens or hundreds of vehicles remain connected for several hours, charging can often be shifted within operational limits. An aggregator could use that flexibility to reduce charging during a local network constraint and increase consumption later.
The fleet operator could receive a flexibility payment while ensuring every vehicle is sufficiently charged when required. The same principle is described for commercial buildings using air-conditioning, heating, refrigeration or ventilation systems capable of temporarily modifying electricity consumption without materially affecting occupants or operations. Industrial consumers are listed as participating through pumps, compressors, thermal processes or other flexible loads.
Buy-versus-build decisions for DSOs
The text states that distribution companies may face the biggest commercial impact from the approach. It describes traditional network planning as capital-intensive, with operators often needing new transformers, substations, cables or other equipment when demand increases or distributed generation creates congestion. Local flexibility introduces a buy-versus-build decision for whether DSOs invest immediately in physical capacity or procure flexibility during constraint hours.
In some areas it states infrastructure will remain the better solution, while in others flexibility could defer reinforcement for several years. It also frames flexibility as having a measurable economic benchmark through avoided or deferred costs of conventional grid investment. The approach further introduces longer-term flexibility contracts rather than purely short-term electricity-market transactions.
A DSO that expects constraints in a particular network area for several years could potentially procure guaranteed flexibility from local resources. The text links this to more predictable revenues for aggregators and asset owners and easier financing of automation investments. It also connects these contracts to local resources rather than only short-term transactions.
HEDGE-IoT data exchange supporting local flexibility markets
Greece is also examining related concepts through HEDGE-IoT, involving IPTO, HEDNO, PPC and HENEX. The programme combines flexibility procurement with exchange of operational data among market participants. The data layer is described as creating another commercial market.
A local flexibility system needs information on where participating assets are located, how much flexibility they can provide, when they are available and whether activation solved the relevant network problem. This creates demand for meter-data platforms, grid analytics, forecasting software, automated dispatch, flexibility verification and settlement systems. It also states that software connecting thousands of customer assets with network operators in close to real time is required for successful operation.
Multiple buyers for one asset under priority and settlement rules
The Greek model tests whether one asset can have several potential customers within the emerging flexibility economy. IPTO may want an industrial load to reduce consumption for national balancing while HEDNO may need the same asset to behave differently due to local congestion. A supplier or aggregator may have another incentive depending on market participation.
The text says rules are needed governing priority, availability and settlement because multiple buyers can target the same physical capacity. It describes opportunities for companies able to coordinate assets across several markets to capture more revenue from the same infrastructure without double selling capacity. It also lists examples including EV chargers, heat pumps or industrial processes generating value from electricity-price optimisation, balancing services and local network flexibility at different times.
Energy-services expansion if pilots move into commercial procurement
If pilots move into commercial procurement, the material says consequences would extend beyond traditional electricity-sector players listed in Greece’s projects. Aggregators would gain a new market while industrial companies could monetise flexible operations through participation described earlier in factories and other flexible loads.
The text lists EV charging companies adding grid services to charging revenues and building-management companies turning HVAC systems into dispatchable assets. Energy-software providers are described as selling optimisation and settlement platforms alongside other listed software functions required by local markets.
It also states that HEDNO could gain an alternative to some network reinforcement while electricity customers could begin earning revenue from assets they already own under the model being tested in Greece.